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Revenue for not-for-profit hospital

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Asked: Jul 14th, 2013

Question description

1. A private sector, not-for-profit hospital received a pledge of $100,000 in 2011, with no purpose restriction. The pledge card indicated that the funds were to be used in 2012. Cash was turned over to the hospital in 2012. The not-for-profit hospital would recognize contribution revenue: (Points : 1)

4. For hospitals, contractual adjustments to 3rd party payers, such as insurance companies, are recorded with a debit to Contractual Adjustment expense and a credit to accounts receivable. (Points : 1)

6. A skilled carpenter repaired the roof for a private not-for-profit free of charge. The not-for-profit would have had to pay $2,000 for this service if not donated. What entry should the not-for-profit make? (Points : 1)

No entries are required for this event.

Improvements $2,000

Building $2,000

Service expense $2,000

7. The financial statements of private not-for-profits are intended primarily for use by present and potential donors. (Points : 1)

True

False

8. According to the National Association of College and Business Officers, scholarship discounts and allowances paid by institutional funds: (Points : 1)

are included in tuition revenue and recorded as an expense.

are not included in tuition revenue but are included as an "other source".

are reported as a reduction of revenue by directly reducing the revenue account or a contra- revenue account.

are reported as an adjustment to tuition revenue in the government-wide statements.

9. Not-for-profit health care entities are distinguished from voluntary health and welfare organizations in the following manner: (Points : 1)

Health care organizations are considered to be primarily business-oriented, whereas voluntary health and welfare organizations raise a significant portion of their money from voluntary contributions.

Health care organizations do not provide services to individuals who are unable to pay.

10. A Statement of Functional Expenses, which is required for voluntary health and welfare organizations, presents a matrix of expenses classified by function and by object or natural classification. (Points : 1)